Gilman Ciocia merged with National Holdings Corporation

  • Background:  Headquartered in Poughkeepsie, New York, Gilman Ciocia provides financial planning, accounting, income tax preparation, and asset management services in the U.S. Specifically, the Company provides financial planning services to individual investors, tax preparation services to individuals in the middle and upper income tax brackets and accounting services to small and midsize companies.
  • Cassel Salpeter:
    • Served as financial advisor to the Company
    • Ran a competitive sales process, identifying and contacting over 70 strategic and financial parties
    • Issued a Fairness Opinion in connection with the transaction

Challenges:

    • Positioned a unique public company with formally combined financial planning and tax preparation services on the same premises
    • Maximized value and provided an exit for private equity investors and shareholders, while maintaining stability amongst financial planners and tax professionals
  • Outcome: In October 2013, Gilman Ciocia, Inc. merged with National Holdings Corporation, a financial services organization based in New York, NY.

James Cassel: Seeking VC funds? Get creative

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By: James Cassel
May 13, 2013

At a cocktail party earlier this year, my friend’s daughter took the initiative to tell me about her new startup venture. Her story piqued my interest, so I did some homework and later decided to throw a little angel money into her San Francisco-based company, “FunLoop.”

Welcome to the world of “venture capital and angel investment” in South Florida.
Although we can credit the region for its progress in cultivating a venture capital (VC) community and nurturing startups, there’s no doubt the region continues to lag behind places like California, Massachusetts and New York City in terms of access to venture capital.

Think about it: Florida is the third-largest state in the country, and South Florida is the fifth-largest Designated Market Area (DMA), but we don’t have the third-largest or even the fifth-largest number of VC’s or VC-funded companies. The area has a huge gap in seed-stage capital, which happens to be the most important stage where business concepts are proved and growth strategies are developed. Although there are a significant number of angel investors in the region, they aren’t easily found unless you know what rocks to search under.

According to a recent MoneyTree Report published by PricewaterhouseCoopers and the National Venture Capital Association, the Sunshine State dropped from No. 13 to No. 18 for VC dollars invested in 2012. Investment in Florida companies dropped $141 million, or 42 percent, from 2011.

There’s no doubt that institutions like The Knight Foundation, The Launch Pad at the University of Miami, the FIU Pino Entrepreneurship Center, the Venture Hive, among others, are making tremendous strides in promoting entrepreneurship and innovation. They must continue moving forward with their fine work, which is critical to our region’s success and future. The VC’s (not to be confused with angel investors) are a growing but still small group that includes Antares Capital, Medina Capital, HIG Ventures and Florida Growth Fund, to name a few. Angel groups and networks include New World Angels and Venture Architects Investor Network.

But the undeniable truth remains that we will not be able to reach California, Massachusetts or New York City status until we have access to more capital — or the reputation for being a prime venue for this sort of entrepreneurial activity. South Florida still simply lacks the big-name, high-quality VC funds that are commonly found in other regions.

So, how do you access venture capital? Unfortunately, there’s no magic pill. Success here will require a lot of research, networking, relationship-building and luck.

There are plenty of angel investors out there, but unfortunately there isn’t one clearinghouse to find them. More often than not, entrepreneurs are finding their angels the way my friend’s daughter found me — by luck at a cocktail party or networking event.

A good way to begin: Identify and attend the right networking events and conferences that have the most fertile ground. Let your contacts know what you’re trying to do, and ask if they know any potential investors who may be interested. Some websites might be of help. Investment bankers can always help too, but few work with startup or very early stage companies. We have posted a list of venture capital resources at http://casselsalpeter.wpengine.com/knowledge/resources/

Reach out to the universities and determine what opportunities may exist for you. Florida International University, Florida Atlantic University, Nova Southeastern University and the University of Miami, for example, offer a broad range of opportunities, including everything from business plan competitions to access to funding.

Keep in mind that you may have to go find your money in other markets as well, which means you will have to travel and do lots of networking. Like it or not, you also may have to move to another city.
While we can’t ignore that VC-backed companies based in Florida, such as Citrix Systems, CBS Sportsline and Mako Surgical, have been acquired or gone public, we are still seeing many angel and VC’s investors requiring that entrepreneurs relocate to other areas before they will invest. Time and again, I’m seeing California VC’s saying: “You have to move to the valley.”

South Florida has come a very long way during the past decade. While the future looks bright, the promised land is still at least another decade away at the rate we’re going, and it will take a lot of hard work and joint effort to get there.

James S. Cassel is co-founder and chairman of Cassel Salpeter & Co., LLC, an investment-banking firm with headquarters in Miami that works with middle-market companies.www.casselsalpeter.com

James Cassel: Seeking VC funds? Get creative

To view original article click here.

By: James Cassel
May 13, 2013

At a cocktail party earlier this year, my friend’s daughter took the initiative to tell me about her new startup venture. Her story piqued my interest, so I did some homework and later decided to throw a little angel money into her San Francisco-based company, “FunLoop.”

Welcome to the world of “venture capital and angel investment” in South Florida.
Although we can credit the region for its progress in cultivating a venture capital (VC) community and nurturing startups, there’s no doubt the region continues to lag behind places like California, Massachusetts and New York City in terms of access to venture capital.

Think about it: Florida is the third-largest state in the country, and South Florida is the fifth-largest Designated Market Area (DMA), but we don’t have the third-largest or even the fifth-largest number of VC’s or VC-funded companies. The area has a huge gap in seed-stage capital, which happens to be the most important stage where business concepts are proved and growth strategies are developed. Although there are a significant number of angel investors in the region, they aren’t easily found unless you know what rocks to search under.

According to a recent MoneyTree Report published by PricewaterhouseCoopers and the National Venture Capital Association, the Sunshine State dropped from No. 13 to No. 18 for VC dollars invested in 2012. Investment in Florida companies dropped $141 million, or 42 percent, from 2011.

There’s no doubt that institutions like The Knight Foundation, The Launch Pad at the University of Miami, the FIU Pino Entrepreneurship Center, the Venture Hive, among others, are making tremendous strides in promoting entrepreneurship and innovation. They must continue moving forward with their fine work, which is critical to our region’s success and future. The VC’s (not to be confused with angel investors) are a growing but still small group that includes Antares Capital, Medina Capital, HIG Ventures and Florida Growth Fund, to name a few. Angel groups and networks include New World Angels and Venture Architects Investor Network.

But the undeniable truth remains that we will not be able to reach California, Massachusetts or New York City status until we have access to more capital — or the reputation for being a prime venue for this sort of entrepreneurial activity. South Florida still simply lacks the big-name, high-quality VC funds that are commonly found in other regions.

So, how do you access venture capital? Unfortunately, there’s no magic pill. Success here will require a lot of research, networking, relationship-building and luck.

There are plenty of angel investors out there, but unfortunately there isn’t one clearinghouse to find them. More often than not, entrepreneurs are finding their angels the way my friend’s daughter found me — by luck at a cocktail party or networking event.

A good way to begin: Identify and attend the right networking events and conferences that have the most fertile ground. Let your contacts know what you’re trying to do, and ask if they know any potential investors who may be interested. Some websites might be of help. Investment bankers can always help too, but few work with startup or very early stage companies. We have posted a list of venture capital resources at http://casselsalpeter.wpengine.com/knowledge/resources/

Reach out to the universities and determine what opportunities may exist for you. Florida International University, Florida Atlantic University, Nova Southeastern University and the University of Miami, for example, offer a broad range of opportunities, including everything from business plan competitions to access to funding.

Keep in mind that you may have to go find your money in other markets as well, which means you will have to travel and do lots of networking. Like it or not, you also may have to move to another city.
While we can’t ignore that VC-backed companies based in Florida, such as Citrix Systems, CBS Sportsline and Mako Surgical, have been acquired or gone public, we are still seeing many angel and VC’s investors requiring that entrepreneurs relocate to other areas before they will invest. Time and again, I’m seeing California VC’s saying: “You have to move to the valley.”

South Florida has come a very long way during the past decade. While the future looks bright, the promised land is still at least another decade away at the rate we’re going, and it will take a lot of hard work and joint effort to get there.

James S. Cassel is co-founder and chairman of Cassel Salpeter & Co., LLC, an investment-banking firm with headquarters in Miami that works with middle-market companies.www.casselsalpeter.com

Brazilian bank set to samba with City National?

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By Lindsey White
May 16, 2013

The rumor mill keeps churning about the looming sale of City National Bank of Florida. Recent reports suggest that Banco do Brasil SA is closing in on a purchase of Valencia, Spain-based Bankia’s Florida franchise.

On May 9, Bloomberg Television reported that Banco do Brasil is near a $900 million deal. Bloomberg originally identified Banco do Brasil as a bidder in April. On May 15, Dow Jones Newswires cited an unnamed banker as saying that the 1.18 trillion-Brazilian-real bank is in the “final stages” of acquiring Miami-based City National, in a transaction expected to close at the end of the month.

When contacted by SNL, Banco do Brasil declined to comment on its interest in growing in the Miami market — but some say the City National acquisition would make sense, given the Brazilian bank’s existing footprint in Florida.

Banco do Brasil acquired Coral Gables, Fla.-based EuroBank in early 2012. The acquisition is expected to contribute to Banco do Brasil’s expansion of business in the U.S., focusing on Brazilian and Hispanic customers, the Brazilian bank said in a first-quarter presentation.

map

EuroBank, renamed Banco do Brasil Americas, had $82.1 million in assets at March 31. The bank has three branches, including a recently opened location on Miami’s Brickell Avenue.

“I just couldn’t imagine them going into the Miami market and staying at less than $100 million in assets,” said Paula Johannsen, a managing director at Monroe Securities. “They didn’t come there just to buy two or three branches of a small community bank.”

James Cassel, chairman and co-founder of Miami-based investment banking firm Cassel Salpeter & Co., said it can be a wise strategy to dip a toe into the U.S. market before diving in fully. A bank that does so can put the regulatory approval process behind it before going after larger deals. If Banco do Brasil were to bid on City National, the fact that the Brazilian bank already has a charter in the U.S. could make the seller’s board more comfortable, he said.

Cassel pointed to the example of Spanish Banco de Sabadell SA, which bought Miami-based Transatlantic Holding Corp. in 2007, before further expanding with the purchase of Miami-based Mellon United National Bank. Sabadell is also among those rumored to be interested in buying City National, along with a number of other banks.

Benjamin Bishop Jr., chairman of Southeast-focused investment bank Allen C. Ewing & Co., said the Miami market is “one of the most dynamic in the country” and “very attractive” to foreign banks looking for a foothold in the U.S. “Miami had a huge number of unsold condominiums a couple years ago on Brickell Avenue,” he noted. Today, he said, many of those condos have sold as foreign nationals scooped up properties.

“A lot of the wealth in Central and South America is going to Miami, and if anything will probably be accelerating,” Bishop said.

Observers agree that if Banco do Brasil is looking to buy, City National is an attractive target. Cassel called City National a “wonderful franchise.” The bank has a long history, a network of 26 branches with good locations, a solid core group of employees and a loyal customer base that stuck with it when City National was last sold, he said. In 2008, Bankia’s Caja Madrid bought an 83% stake in City National Banc shares Inc. in a $927.0 million deal.

Observers noted that there are several banks in South Florida, but few of City National’s size and quality. The bank had $4.74 billion in assets as of March 31, and nonperforming assets totaled just 0.97% of total assets.

This could help City National fetch a good price. According to SNL data, live bank deals announced since Jan. 1, 2012, with Florida-based targets have had a median tangible book value of 100.7% and a mean value of 102.3%. Johannsen characterized pricing for recent Florida bank deals as “all over the board,” but said that many people expect City National will generate more of a premium.

“For the international-type banks that want to get in there, it’s the best quality right now,” Johannsen said.

 

Other Venture Capital Organizations

 

Entrepreneurship & Venture Capital in Florida

Venture Capital sources in Florida include both local “Angel” or early-round investors and Venture Capital firms that invest in the state. Many of the latter are located in Florida but many others are located outside the state but have shown an interest in investing in the life sciences in Florida.

All investors focus on certain types of business and specific geographies, and they clearly state their investment focus on their website, so you should investigate that before contacting them.

 

James Cassel: Plan now to get the most value from selling your business

To view original article click here.

By: James Cassel
April 14, 2013

When selling your business, advance planning and strategic action can make a big difference toward helping you obtain the maximum value for your firm. The sooner you begin your preparation, the better.

Here is some practical advice that I have learned throughout my career leading the purchases and sales of middle-market businesses in South Florida and around the country. These tips are not only helpful if you’re planning to sell — they’re also generally good business practice.

•  Hire an effective public relations firm. Positive news coverage in credible, top-tier media outlets that reach current and potential customers as well as buyers can be invaluable in terms of elevating firm and brand awareness, securing credibility for your business and even piquing interest from potential buyers. Although directed to enhance the business, raising visibility is important. These days, depending on the nature of your business, social media might be an appropriate tool to leverage as well.

•  Get your financial and accounting records in order. It is imperative for you to be able to give potential buyers a clear, accurate snapshot of your historical financial results and condition. Without this, you won’t be able to get as much for your business. You’ll have to do all this paperwork anyway, so the sooner you get your financial house in order, the better. Preparing a budget is helpful too.

•  Review agreements with your customers. Do you have long-term contracts that will bring recurring revenues to the purchaser of your business? Do your contracts with customers have special terms, such as requirements that you personally provide service to the accounts or change of control provisions, which may have an impact on the longevity of the contracts when you’re no longer involved with the business? Make sure you review and structure agreements in advance so they will enhance the value of your business and appeal to potential buyers.

•  Review your leases. Do you have a long-term lease that new buyers will have to continue, or do you have a short-term lease giving buyers maximum flexibility? This can enhance or decrease the value of the business. I recently worked on a deal in which a long-term lease for excessive space became a roadblock to completing the deal. Sometimes, a long-term lease at favorable rates can enhance the value of a business.

•  Review agreements with your suppliers. Again, like in No. 4 above, you need to understand whether you’re locked into agreements with suppliers with which the new owner(s) of your business will be required to comply. Depending on price and terms, a long-term supply agreement can be an asset or a liability. If there are any agreements that you don’t consider beneficial to your business, then now would be a good time to try to terminate them or address the issues to avoid turning off potential buyers.

•  Review your insurance coverage. Depending on your business, liability coverage and tail coverage might be very important. Consult a good insurance agent to evaluate your existing coverage and file any gaps that might exist.

•  Do tax and estate planning. Work with qualified lawyers and accountants who can help ensure you have structured your ownership in the most tax- advantaged way in the event of a sale. Again, the sooner you do this, the better off you’ll be.

•  Discuss the possibilities with your family. As in most everything in life, it’s important to have an understanding with your family members – especially if they are part owners of your business or work in the business. Make sure your family members and other key stakeholders fully understand the possible impacts of the business sale on everyone involved.

•  Evaluate your intellectual property. Make sure it is protected and owned or licensed by the right entity. This can be a great asset or, in some cases, a great liability. Work with a knowledgeable lawyer to get your house in order. Make sure you have proper licenses for all the software you use.

•  Evaluate management. Do you have appropriate management in place or are there gaps that you should fill prior to putting your business on the market? Examine your employment agreements to ensure you have important non-compete, confidentiality and other provisions that can significantly enhance the value of your business.

•  Determine if there are environmental issues. Commissioning a study to identify all environmental issues can be a good idea. Then, you should either remediate them or at least have an accurate understanding of what will be required to clean them up.

•  Get organized. An organized business owner who comes to the table with his or her house in order gives a good impression and strong comfort level to potential buyers.

The key here is to work with qualified advisors, including attorneys, accountants and investment bankers, to put your business in the best-possible position for sale. By addressing the weaknesses and playing up your strengths now, you can help ensure you get the best value for your business. 

James Cassel is co-founder and chairman of Cassel Salpeter & Co., LLC, an investment-banking firm with headquarters in Miami that works with middle-market companies. www.casselsalpeter.com

 

 

James Cassel: Plan now to get the most value from selling your business

To view original article click here.

By: James Cassel
April 14, 2013

When selling your business, advance planning and strategic action can make a big difference toward helping you obtain the maximum value for your firm. The sooner you begin your preparation, the better.

Here is some practical advice that I have learned throughout my career leading the purchases and sales of middle-market businesses in South Florida and around the country. These tips are not only helpful if you’re planning to sell — they’re also generally good business practice.

•  Hire an effective public relations firm. Positive news coverage in credible, top-tier media outlets that reach current and potential customers as well as buyers can be invaluable in terms of elevating firm and brand awareness, securing credibility for your business and even piquing interest from potential buyers. Although directed to enhance the business, raising visibility is important. These days, depending on the nature of your business, social media might be an appropriate tool to leverage as well.

•  Get your financial and accounting records in order. It is imperative for you to be able to give potential buyers a clear, accurate snapshot of your historical financial results and condition. Without this, you won’t be able to get as much for your business. You’ll have to do all this paperwork anyway, so the sooner you get your financial house in order, the better. Preparing a budget is helpful too.

•  Review agreements with your customers. Do you have long-term contracts that will bring recurring revenues to the purchaser of your business? Do your contracts with customers have special terms, such as requirements that you personally provide service to the accounts or change of control provisions, which may have an impact on the longevity of the contracts when you’re no longer involved with the business? Make sure you review and structure agreements in advance so they will enhance the value of your business and appeal to potential buyers.

•  Review your leases. Do you have a long-term lease that new buyers will have to continue, or do you have a short-term lease giving buyers maximum flexibility? This can enhance or decrease the value of the business. I recently worked on a deal in which a long-term lease for excessive space became a roadblock to completing the deal. Sometimes, a long-term lease at favorable rates can enhance the value of a business.

•  Review agreements with your suppliers. Again, like in No. 4 above, you need to understand whether you’re locked into agreements with suppliers with which the new owner(s) of your business will be required to comply. Depending on price and terms, a long-term supply agreement can be an asset or a liability. If there are any agreements that you don’t consider beneficial to your business, then now would be a good time to try to terminate them or address the issues to avoid turning off potential buyers.

•  Review your insurance coverage. Depending on your business, liability coverage and tail coverage might be very important. Consult a good insurance agent to evaluate your existing coverage and file any gaps that might exist.

•  Do tax and estate planning. Work with qualified lawyers and accountants who can help ensure you have structured your ownership in the most tax- advantaged way in the event of a sale. Again, the sooner you do this, the better off you’ll be.

•  Discuss the possibilities with your family. As in most everything in life, it’s important to have an understanding with your family members – especially if they are part owners of your business or work in the business. Make sure your family members and other key stakeholders fully understand the possible impacts of the business sale on everyone involved.

•  Evaluate your intellectual property. Make sure it is protected and owned or licensed by the right entity. This can be a great asset or, in some cases, a great liability. Work with a knowledgeable lawyer to get your house in order. Make sure you have proper licenses for all the software you use.

•  Evaluate management. Do you have appropriate management in place or are there gaps that you should fill prior to putting your business on the market? Examine your employment agreements to ensure you have important non-compete, confidentiality and other provisions that can significantly enhance the value of your business.

•  Determine if there are environmental issues. Commissioning a study to identify all environmental issues can be a good idea. Then, you should either remediate them or at least have an accurate understanding of what will be required to clean them up.

•  Get organized. An organized business owner who comes to the table with his or her house in order gives a good impression and strong comfort level to potential buyers.

The key here is to work with qualified advisors, including attorneys, accountants and investment bankers, to put your business in the best-possible position for sale. By addressing the weaknesses and playing up your strengths now, you can help ensure you get the best value for your business. 

James Cassel is co-founder and chairman of Cassel Salpeter & Co., LLC, an investment-banking firm with headquarters in Miami that works with middle-market companies. www.casselsalpeter.com

 

 

People on the move

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Untitled

Cassel Salpeter & Co. Named Winner of 7TH Annual M&A Advisor Turnaround Award for the Firm’s Work on Airline Restructuring Deal

James Cassel and Scott Salpeter, co-founders of Cassel Salpeter & Co., an independent investment banking firm that provides advice to middle-market and emerging growth companies in the U.S. and worldwide, were named winners in the “Sector Deal of the Year: Consumer Services” category in the 7th Annual M&A Advisor Turnaround Awards for their work in the restructuring and sale of Silver Airways (formerly Gulfstream International Airlines) to Victory Park Capital. When Gulfstream International Airlines filed for bankruptcy, Cassel, CEO, and his colleague Salpeter, the firm’s president, assisted in the $30 million sale to Victory Park Capital. The award ceremony took place at the Colony Hotel in Palm Beach, FL. Please visit: http://casselsalpeter.wpengine.com/